AMENDMENT TO SECURITIES PURCHASE AGREEMENT
This Amended Securities Purchase Agreement (this "Agreement")
is entered into this 5th day of March, 1998, by and between LANXIDE CORPORATION,
a Delaware corporation ("Lanxide") and COMMODORE ENVIRONMENTAL SERVICES, INC., a
Delaware corporation, ("COES").
RECITALS:
WHEREAS, Lanxide's subsidiary, Lanxide Performance, is a party
to and borrower under (i) a Line of Credit Agreement with Commodore Applied
Technologies, Inc. Lender, dated August 30, 1996 in the amount of $1.5 Million
(the "$1.5 Million Credit Agreement"), (ii) a Line of Credit Promissory Note
dated August 30, 1996 in the amount of $1.5 Million (the "$1.5 Million Note"),
and (iii) a Security Agreement dated August 30, 1996 in the amount of $1.5
Million (the "$1.5 Million Security Agreement"); Lanxide is a guarantor of the
aforementioned $1.5 Million Credit Agreement and $1.5 Million Note; thc $1.5
Million Credit Agreement, Note, Security Agreement and Guaranty Agreement are
hereinafter collectively referred to as the "Lanxide Performance $1.5 Million
Loan Documents");
WHEREAS, Lanxide Performance is a party to and borrower under
a certain Line of Credit Agreement with COES dated November 13, 1996 in the
amount of $3 Million (the "$3 Million Credit Agreement"), a Line of Credit
Promissory Note dated November 13, 1996 (the "$3 Million Note"), a corresponding
Security Agreement dated November 13, 1996 (thc $3 Million Security Agreement");
Lanxide guaranteed the aforementioned $3 Million Credit Agreement, the $3
Million Note and $3 Million Security Agreement (the "Lanxide $3 Million
Guaranty"); the aforementioned $3 Million Credit Agreement, the $3 Million Note,
the $3 Million Security Agreement and the $3 Million Lanxide Guaranty are
hereinafter collectively referred to as the "Lanxide Performance $3 Million Loan
Documents");
WHEREAS, Lanxide and COES are parties to a Securities Purchase
Agreement dated the third day of July, 1997 (the "Securities Purchase
Agreement") pursuant to which, inter alia, Lanxide granted to COES a warrant
entitling COES or the holder to purchase up to 250,000 shares of Lanxide Series
F Preferred Stock (the "Series F Preferred Stock") at an exercise price of $100
per warrant (the "Original Warrant"); and
WHEREAS, certain individual stockholders of Lanxide entered
into a "Voting Agreement" with Bentley X. Xxxx ("Xxxx"), Xxxx X Xxxxxxxxx
("Xxxxxxxxx"), Xxxxx Xxxxxxxx ("Xxxxxxxx"), Xxxxxxx Xxxxx ("Xxxxx") and Xxxxxxx
Xxxxxxx ("Xxxxxxx") (collectively the "Proxy Holders") pursuant to which said
Lanxide stockholders granted a proxy to the Proxy Holders to vote their shares
in Lanxide.
NOW, THEREFORE, in consideration of the foregoing Recitals and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and intending to be legally bound, it is hereby agreed as
follows:
1. Definitions. "Common Stock Warrant" shall mean the three
(3) year warrant issued to COES on the execution and delivery date hereof
entitling the holder to purchase up to 270,000 shares of Lanxide common stock,
at an exercise price of $7.41 per warrant share, in substantially the form of
Exhibit "A" annexed hereto.
2. Cancellation of Share Purchase Right. The parties hereto
acknowledge and agree that COES's right to purchase any additional shares of
Series G Preferred Stock of Lanxide (the "Series G Preferred Stock"), as
provided in Section 2.2(c) and (d) of the Securities Purchase Agreement is
hereby cancelled.
3. Cancellation of Warrant. The parties hereto hereby agree
that the Warrant which Lanxide issued to COES for the right to purchase any
shares of preferred stock, as set forth in Section 2.3 of the Securities
Purchase Agreement, is hereby cancelled.
4. Board Action for Series F Preferred Stock; Consent to
Employee Stock Option Plan: Consent to Landlord Warrant Modifications. Lanxide
hereby covenants and agrees not to issue any shares of Series F Preferred Stock
and shall take all necessary action as soon as practicable to cancel all Series
F Preferred Stock, and COES hereby consents to such cancellation.
COES hereby consents to the adoption by Lanxide of a stock
option plan anticipated to be approved by Lanxide on or before March 31, 1998
(i) pursuant to which certain employees of Lanxide will be given five year
options to acquire shares of Common Stock for an exercise price anticipated to
be $1.00 per share and (ii) under which the aggregate number of shares to be
reserved for issuance is not to exceed twenty-five percent (25%) of the issued
and outstanding shares of Common Stock as of the date hereof on a fully diluted
basis, including shares of Common Stock issuable under the Common Stock Warrant
COES hereby consents to Lanxide's modifications to an
outstanding Warrant to acquire shares of Common Stock registered in the name of
W.P. Xxxxx & Co., Inc., or an affiliate thereof, which entity is Lanxide's
landlord for its principal place of business, provided that such modifications
do not (i) reduce the exercise price under such modified Warrant below $1.00 per
share of Common Stock issuable upon exercise of such Warrant or (ii) increase
the maximum number of shares of Common Stock issuable upon a exercise of such
modified Warrant to a number that is greater than 31,000 shares.
5. Post-Closing Financing and Consummation. The parties hereto
hereby acknowledge and agree that COES's duty to seek or obtain post-closing
financing and/or to consummate any of the transactions contemplated in the
Securities Purchase Agreement not already consummated prior to the execution
date hereof are hereby cancelled.
6. Exchange of Shares of Series G Preferred Stock; Board
Action for Series G Preferred Stock; Common Stock Warrant. Lanxide, in
consideration for (a) the terms and conditions of this Agreement, (b) other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, shall (i) upon surrender to Lanxide of the share certificates
representing COES' ownership of all shares of Series G Preferred Stock, issue
share certificate(s), in such denominations and registered in such names as COES
may reasonably request, representing ownership of a like number of shares of
Lanxide' s Preferred Stock, Series H, having terms and conditions set forth on
Exhibit B hereto (the "Series H Preferred Stock"), (ii) following COES'
surrender of the certificates representing its ownership of Series G Preferred
Stock, cause its Board to cancel all Series G Preferred Stock, and COES hereby
consents to such cancellation, and (iii) issue to COES (in such denominations as
may reasonably be requested by COES) the Common Stock Warrant.
7. Registration Rights. The following provisions replace the
provisions set forth in Section ll of the Securities Purchase Agreement:
7.1 Piggyback Rights. If at any time following the date
hereof, Lanxide shall file a registration statement (other than a registration
statement on Form X-0, Xxxx X-0, or any successor form) with the SEC while any
Registrable Securities (as hereinafter defined) are outstanding, Lanxide shall
give all the then holders of any Registrable Securities or securities which are
convertible into or exercisable for Registrable Securities, including for this
purpose, holders of the Registrable Securities (the "Eligible Holders") at least
30 days prior written notice of the filing of such registration statement. If
requested by any Eligible Holder in writing within 15 days after receipt of any
such notice, Lanxide shall, at Lanxide's sole expense (other than the fees and
disbursements of counsel for the Eligible Holders and the under writing
discounts or commissions, if any, payable in respect of the Registrable
Securities sold by any Eligible Holder), register or qualify all or, at each
Eligible Holder's option, any portion of the Registrable Securities of any
Eligible Holders who shall have made such request, concurrently with the
registration of such other securities, all to the extent requisite to permit the
public offering and sale of the Registrable Securities through the facilities of
all appropriate securities exchanges and the over-the-counter market, and will
use its best efforts through its officers, directors, auditors, arid counsel to
cause such registration statement to become effective as promptly as
practicable. Notwithstanding the foregoing, if the managing underwriter of any
such offering shall advise Lanxide in writing that, in its opinion, the
distribution of all or a portion of the Registrable Securities requested to be
included in the registration concurrently with the securities being registered
by Lanxide would adversely affect the distribution of such securities by Lanxide
for its own account, then the underwriters shall have the right to exclude any
or all of the securities that the Eligible Holders or other prospective seller
requested to be included in such public offering; provided, however, that such
exclusion shall be made pro rata amone the Eligible Holders and the other
stockholders of Lanxide that have registration rights or have otherwise
requested to participate on a piggyback basis in such public offering in
proportion to the respective number of shares of securities which were requested
to be included in such public offering. As used herein, "Registrable Securities"
sl~ll mean the shares of Lanxide Common Stock issuable upon full or partial
exercise of the Warrant, which have not been previously sold pursuant to a
registration statement or Rule 144 promulgated under the 0000 Xxx.
7.2 If at any time following COES's completion of its purchase
and payment for any of the 270,000 Shares of Common Stock, Lanxide shall receive
a written request, from Eligible Holders who in the aggregate own (or upon
exercise of all Warrants then outstanding or issuable would own) at least 50% of
the Registrable Securities then included (or upon such exercises would be
included) in the Registrable Securities (the "Majority Holders"), to register
the sale of all or part of such Registrable Securities, Lanxide shall, as soon
as reasonably practicable, but in any event within 180 days of Lanxide's receipt
of a written request from the Eligible Holders, prepare and file with the SEC a
registration statement sufficient to permit the public offering and sale of the
Registrable Securities through the facilities of all appropriate securities
exchanges and the over-the-counter market, and will use its best efforts through
its officers, directors, auditors and counsel to cause such registration
statement to become effective within such 180 day time period; provided,
however, that the Eligible Holders shall bear all expenses, fees (including
Lanxide's reasonable attorney's fees) and disbursements incurred in connection
with such registration. Lanxide shall not be obligated to effect any
registration of its securities pursuant to this Section 7.2 within six months
after} the effective date of a previous registration statement prepared and
filed in accordance with Sections 7.1 or 7.2 Within seven (7) business days
after receiving any request contemplated by this Section 7.2, Lanxide shall give
written notice to all the other Eligible Holders, advising each of them that
Lanxide is proceeding with such registration and offering to include therein all
or any portion of any such other Eligible Holder's Registrable Securities,
provided that Lanxide receives a written request to do so from such Eligible
Holder within fifteen (15) days after receipt by him or it of Lanxide's notice.
Provided, however, that the Eligible Holders may not make such a request or
demand provided for in this Section 7.2 before January 1, 2000.
7.3 Blue Sky Matters. In the event of a registration pursuant
to the provisions of this Section 7, Lanxide shall use its best efforts to cause
the Registrable Securities so registered to be registered or qualified for sale
under the securities or blue sky laws of such jurisdictions as the Eligible
Holder or such holders may reasonably request; provided, however. that Lanxide
shall not be required to qualify to do business in any state by reason of this
Section 7.3 in which it is not otherwise required to qualify to do business.
7.4 Period During Which Registration Statement to Remain
Effective. Lanxide shall keep effective any registration or qualification
contemplated by this Section 7 and shall from time to time amend or supplement
each applicable registration statement, preliminary prospectus, final
prospectus, application, document, and communication for such period of time as
shall be required to permit the Eligible Holders to complete the offer and sale
of the Registrable Securities covered thereby. Lanxide shall in no event be
required to keep any such registration or qualification in effect for a period
in excess of nine months from the date on which the Eligible Holders are first
free to sell such Registrable Securities, provided. however, that, if Lanxide is
required to keep any such registration or qualification in effect with respect
to securities other than the Registrable Securities beyond such period, Lanxide
shall keep such registration or qualification in effect as it relates to the
Registrable Securities for so long as such registration or qualification remains
or is required to remain m effect in respect of such other securities.
7.5 Copies of Documents. In the event of a registration
pursuant to the provisions of this Section 7, Lanxide shall furnish to each
Eligible Holder such number of copies of the registration statement and of each
amendment and supplement thereto (in each case, including all exhibit), such
reasonable number of copies of each prospectus contained in such registration
statement and each supplement or amendment thereto (including each preliminary
prospectus), all of which shall conform to the requirements of the 1933 Act and
the rules and regulations thereunder, and such other documents, as any Eligible
Holder may reasonably request to facilitate the disposition of the Registrable
Securities included in such registration.
7.6 Opinion of Counsel to Lanxide. In the event of a
registration pursuant to the provisions of this Section 7, Lanxide shall furnish
each Eligible Holder of any Registrable Securities so registered with an opinion
of its counsel (reasonably acceptable to the Eligible Holders) to the general
effect that (i) the registration statement has become effective under thc 1933
Act and no order suspending the effectiveness of the registration statement,
preventing or suspending the use of the registration statement, any preliminary
prospectus, any final prospectus, or any amendment or supplement thereto has
been issued nor has the SEC or any securities or blue sky authority of any
jurisdiction instituted or threatened to institute any proceedings with respect
to such an order, (ii) the registration statement and each prospectus forming a
part thereof (including each preliminary prospectus), and any amendment or
supplement thereto, complies as to form with the 1933 Act and the rules and
regulations thereunder, and (iii) such counsel has no knowledge of any material
misstatement or omission in such registration statement or any prospectus, as
amended or supplemented.
7.7 Terms of Underwriting Agreement. In the event of a
registration pursuant to the provision of this Xxxxxxx 0, Xxxxxxx shall enter
into a cross-indemnity agreement and a contribution agreement, each in customary
form, with each underwriter, if any, and, if requested, enter into an
underwriting agreement containing conventional representations, warranties,
allocation of expenses, and customary closing conditions, including, but not
limited to, opinions of counsel and accountants' cold comfort letters, with any
underwriter who acquires any Registrable Securities.
7. Undertakings of Eligible Holders. In the event of a
registration pursuant to the provisions of this Section 7:
(a) each Eligible Holder shall furnish to Lanxide in writing such
appropriate information (relating to such Eligible Holder and the intention of
such Eligible Holder as to proposed methods of sale or other disposition of
their Shares) and the identity of and compensation to be paid to any proposed
underwriters to be employed in connection therewith as Lanxide, any underwriter,
or the SEC or any other regulatory authority may request;
(b) the Eligible Holders shall enter into the usual and customary form
of underwriting agreement agreed to by Lanxide and any underwriter with respect
to any such offering, if required, and such underwriting agreement shall contain
the customary rights of indemnity between Lanxide, the underwriters, and such
Eligible Holders;
(c) each Eligible Holder shall agree that he shall execute, deliver
and/or file with or supply Lanxide, any underwriters, the SEC and/or any state
or other regulatory authority such information, documents, representations,
undertakings and/or agreements necessary to carry out the provisions of the
registration covenants contained in this Section 1 and/or to effect the
registration or qualification of his or its Registrable securities under the
1933 Act and/or any of the laws and regulations of any state or governmental
instrumentality;
(d) Lanxide's obligation to include any Registrable Securities in a
registration statement shall be subject to the written agreement of each holder
thereof to offer such securities in the same manner and on the same terms and
conditions as the other securities of the same class are bein6 offered pursuant
to the registration statement, if such shares are being underwritten;
(e) in the event that all the Registrable Securities have not been sold
on or prior to the expiration of the period specified in Section 7.4 above,
Lanxide may de-register by post-effective amendment any Registrable Securities
covered by the registration statement, but not sold on or prior to such date.
Lanxide agrees that it will notify each holder of Registrable Securities of the
filing and effective date of such post-effective amendment; and
(f) each Eligible Holder agrees that upon notification by Lanxide that
the prospectus in respect to any public offering covered by the provisions
hereof is in need of revision, such Eligible Holder shall immediately upon
receipt of such notification (i) cease to offer or sell any securities of
Lanxide which must be accompanied by such prospectus, (ii) return all such
prospectuses in such Eligible Holder's hands to Lanxide, and (iii) not offer or
sell any securities of Lanxide until such Holder has been provided with a
current prospectus and Lanxide has given such Eligible Holder notification
permitting such Eligible Holder to resume offers and sales.
7.9 Covenant Regarding Current Information. Lanxide agrees
that until all the Registrable Securities have been sold under a registration
statement or pursuant to Rule 144 under the 1933 Act, it shall use its best
efforts to keep current in filing all reports, statements and other materials
required to be filed with the SEC to permit holders of the Registrable
Securities to sell such securities under Rule 144.
7.10 Negative Covenant Regarding Future Registration Rights.
Except for (i) rights granted to holders of the Warrants. and (ii) rights
granted by Lanxide to other security holders of Lanxide prior to the date
hereof, Lanxide will not, without the written consent of the Majority Holders,
grant to any persons the right to request Lanxide to register any securities of
Lanxide, provided that Lanxide may grant such registration rights to other
persons so long as such rights are subordinate or pari passu to the richts of
the Eligible Holders.
7 11 Definitions. Wherever the term "Warrant" is used in this
Article it means and refers to the Common Stock Warrant defined in Section 1
hereof.
8. Series H Preferred Stock. Lanxide covenants and agrees
that, within seven (7) business days following the execution and delivery of
this Agreement, it will take all necessary action to fix the rights, preferences
and limitations of the Series H Preferred Stock in the manner set forth on
Exhibit B hereto. Lanxide shall deliver to COES a fully executed Certificate of
Stock Designation for the Series H Preferred Stock promptly following the filing
of such certificate.
9. Parties' Representations and Warranties. Each of the
parties hereby represents and warrants to the other party hereto as follows:
9.1 Corporate Organization. Standing. It is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
9.2 Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by it and, subject to the due authorization,
execution and delivery by such other party, constitutes a legal, valid and
binding obligation of it, enforceable in accordance with its terms, except that
(i) the enforceability hereof may be subject to bankruptcy, insolvency,
reorgS~ni7~tion, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights and (ii) the remedy of specific performance and
injunctive and other terms of equitable relief may be subject to equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought. The execution and delivery of this Agreement, the consummation
of the transactions contemplated hereto and the fulfillment and compliance with
the terms and conditions hereof do not and will not after the giving or notice,
or the lapse of time, or otherwise: (a) violate any provisions of any judicial
or administrative order, award. judgment or decree applicable to it, or (b)
conflict with any of the provisions of the Certificate of Incorporation or
By-Laws of it, or (c) conflict with, result in a breach of or constitute a
default under any agreement or instrument to which it is a party or by which it
is bound, except for any of the foregoing that, individually or in the
aggregate, would not have a material adverse effect on the financial condition,
operations or businesses of such party and its subsidiaries taken as a whole.
10. Indemnification. The indemnification provision set forth
in Sections 12.1 through 12.3 of the Securities Purchase Agreement are
incorporated herein by reference as though set forth at length and apply with
equal force with respect to the Common Stock Warrant and stock purchases as a
result of any exercise thereof
11. Miscellaneous.
11.1 Notices. All notices, requests, demands and other
communications under or in respect of this Agreement or any transactions
hereunder shall be in writing (which may include telegraphic or telecopied
communication) and shall be personally delivered, sent by overnight courier,
mailed (registered or certified mail, return receipt requested), telegraphed or
telecopied by facsimile transmission to the applicable party at its address or
telecopier number indicated below.
If to COES:
Commodore Environmental Services, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Atten: Xxxxxxx X. Xxxxxxxx, Esquire
Senior Vice President and General Counsel
Chief Financial and Administrative Officer
Telecopier No.: (000) 000-0000
Commodore Applied Technologies, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Atten: Xxxxxxx X. Xxxxxxxx, Esquire
Senior Vice President and General Counsel
Chief Financial and Administrative Officer
Telecopier No.: (000) 000-0000
If to the Lanxide Companies:
Lanxide Corporation
0000 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000-0000
Atten: Xx. Xxxx X. Xxxxxxx, President
Telecopier No.: (000) 000-0000
11.2 Entire Agreement. This Agreement (including the Exhibits
and Schedules) contains the entire agreement among the parties with respect to
the purchase of the Purchased Shares and related transactions and supersedes all
prior arrangements or understandings, written or oral, with respect thereto.
11.3 Amendments. Any term or condition of this Agreement may
be amended or modified in whole or in part at any time, to the extent authorized
by applicable law, by an agreement in writing, authorized and executed in the
same manner as tins Agreement by the parties hereto. No delay on the part of any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any waiver on the part of any party of any right,
power of privilege hereunder, nor shall any single or partial exercise of any
right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder. The
nights and remedies herein provided are cumulative and are not exclusive of any
rights or remedies which any party may otherwise have at law or in equity. The
rights and remedies of any party arising out of or otherwise in respect of any
inaccuracy in or breach of any representation, warranty, covenant or agreement
contained in this Agreement shall in no way be limited by the fact that the act,
omission, occurrence or breach is based may also be the subject matter of any
other representation, warranty, covenant or agreement contained in this
Agreement (or in any other agreement between the parties) as to which there is
no inaccuracy or breach.
11.4 Severabilitv. If any provision of This Agreement is held
invalid or unenforceable, either in its entirety or by virtue of its scope or
application to given circumstances, such provision shall thereupon be deemed
modified only to the extent necessary to render same valid, or not applicable to
given circumstances, or excised from this Agreement, as the situation may
require, and this Agreement shall be construed and enforced as if such provision
had been included herein as so modified in scope or application, or had not been
included herein, as the case may be.
11.5 Execution and Delivery. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Delivery of a
counterpart shall be deemed effective upon receipt by the other party of
telefaxed signature page to this Agreement, provided that such party shall
nonetheless Transmit its original executed signature page to the other party.
11.6 Exhibits and Schedules. The Exhibits and Schedules and
other documents attached to or delivered herewith are hereby incorporated and
made a part of this Agreement as if set forth in full herein.
11.7 Drafting. No presumption shall operate in favor of or
against any party in the construction or interpretation of this Agreement as a
consequence of a party's responsibility for drafting this Agreement.
11.8 Recitals. The recital clauses of this Agreement are
incorporated herein to the body as though set forth at length.
11.9 Attorney and Professional Fees. Each party will pay
his/her own attorney or professional fees in connection with this Agreement or
settlement discussions leading to this Agreement.
11.10 Captions. The captions of Sections hereof are for
convenience only and shall not control or affect the meaning or construction of
any of the provisions of this Agreement.
11.11 Controlling Law. The parties hereto agree that this
Agreement shall be governed and construed by the internal, substantive laws of
the State of New York (without regard to that state's choice of law rules or
doctrines) and, if applicable, the substantive law (statutory, administrative or
common law) of the United States (without regard to its choice of law, rules or
doctrines) Sellers hereby consent to personal jurisdiction in the State of New
York for the purposes of any matter of or related to this A8reement or any other
agreement between the parties hereto executed and delivered on or about the date
hereof, including for purposes of any amendments hereto or thereto. The parties
hereto further agree that venue for any dispute arising under this Agreement or
for any other agreement between the parties hereto which are executed on or
about the date hereof shall be proper in the United States District Court for
the Southern District of New York. The parties ~Iso expressly waive trial by
jury and the right to request a transfer of venue,
11.12 Binding Effect. This Agreement shall be bindin8 and
inure to the benefit of the named parties hereto, all of their wholly or
partially-owned subsidiaries, the parties on whose behalf and for whose benefit
it is made and their respective heirs, administrators, executors, successors and
assigns.
11.13 Survival. The Securities Purchase Agreement, as amended
by the Amendment, shall survive and remain valid, binding and enforceable
according to its terms.
Remainder of Page Intentionally Left Blank
IN WITNESS WHEREOF, and intending to be legally bound, the
parties have hereto executed this Agreement on the day and date first above
written.
LANXIDE CORPORATION
